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MTECHTIPS:-Gold trades near 3-month peak ahead of U.S. ISM report
Gold futures held near the highest level since November in Europe trade on Monday, amid speculation worries over slowing growth in the U.S. will prompt the Federal Reserve to delay future interest rate hikes. Gold for February delivery on the Comex division of the New York Mercantile Exchange tacked on $4.60, or 0.41%, to trade at $1,121.00 a troy ounce by 8:50 GMT, or 3:50AM ET. Gold rallied to a three-month peak of $1,128.00 last week. The Commerce Department said Friday that the U.S. economy grew at an annual rate of 0.7% in the fourth quarter, missing expectations for growth of 0.8% and slowing from 2.0% in the preceding quarter. Investors were looking ahead to the ISM report on U.S. manufacturing activity later in the day to gauge if the world’s largest economy is strong enough to withstand further rate hikes this year. U.S. consumer spending data is also due Monday. Market participants are anticipating just one more rate hike this year, most likely in July, compared with four according to Fed policymakers’ guidance. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases. Prices of the precious metal ended January with a gain of 5.4%, its biggest monthly rise in a year, as investors sought refuge from turmoil in global equity markets.
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